Although parties may contractually agree to undertake a separate obligation, the breach of which does not arise until some future date, the repurchase obligation undertaken by DBSP does not fit this description. To support its contrary position, the Trust relies on our decision in Bulova Watch Co. v <**25>Celotex Corp. (46 NY2d 606 ), where we considered whether the separate repair clause in a contract for the sale of a roof constituted a future promise of performance, the breach of which created a cause of action. The separate clause the seller included in that contract was a “20-Year Guaranty Bond,” which “expressly guaranteed that [the seller] would ‘at its own expense make any repairs . . . that may become necessary to maintain said Roof’ ” (id. at 608-609).
I kept that the ensure “embod[ied] an agreement different from the brand new bargain available roofing system materials,” the breach from which caused the new law away from limits anew (id. at the 610). This was therefore since the offender from inside the click this link now Bulova Observe “failed to only make sure the reputation or performance of your goods, however, agreed to would an assistance” (id. on 612). You to definitely provider was the new independent and you can collection of pledge to fix a good bad rooftop-a critical element of this new parties’ contract and “yet another, independent and additional bonus to acquire” the fresh defendant’s product (id. from the 611). Correctly, the fresh “agreements considering characteristics . . . was in fact subject to a half dozen-12 months statute . . . running many years occasioned when a violation of the obligations to help you repair new bonded rooftop occurred” (id.).
DBSP’s eliminate or repurchase duty try the newest Trust’s fix for a good breach of those representations and you will warranties, perhaps not a vow of loans’ upcoming overall performance
The fresh new corrective condition inside Bulova Observe expressly secured coming overall performance out of the roof and you may undertook a pledge to repair the fresh rooftop if the it did not satisfy the seller’s verify. It [*7] represented and warranted certain information about the brand new loans’ attributes as of , if MLPA and PSA had been conducted, and you will explicitly stated that those people representations and warranties failed to survive the newest closing time. Rather than new separate guarantee during the Bulova Check out, DBSP’s reduce otherwise repurchase responsibility could not reasonably be looked at since a definite vow out-of future abilities. It actually was dependent on, and even by-product out-of, DBSP’s representations and you can guarantees, and this didn’t survive the brand new closing and were broken, if at all, on that big date. [FN3]
Indeed, absolutely nothing from the offer specified the clean out otherwise repurchase obligation do last for the life of your financing
And it makes sense that DBSP, as sponsor and seller, would not guarantee future performance of the mortgage loans, which <**25>might default 10 or 20 years after issuance for reasons entirely unrelated to the sponsor’s representations and warranties. The sponsor merely warrants certain characteristics of the loans, and promises that if those warranties and representations are materially false, it will cure or repurchase the non-conforming loans within the same statutory period in which remedies for breach of contract (i.e., rescission and expectation damages) could have been sought. [FN4]
If the cure or repurchase obligation did not exist, the Trust’s only recourse would have been to bring an action against DBSP for breach of the representations and warranties. That action could only have been brought within six years of the date of contract execution. The cure or repurchase obligation is an alternative remedy, or recourse, for the Trust, but the underlying act the Trust complains of is the same: the quality of the loans and their conformity with the representations and warranties. The Trust argues, in effect, that the cure or repurchase <**25>obligation transformed a standard breach of contract remedy, i.e. damages, into one that lasted for the life of the investment-decades past the statutory period. But nothing in the parties’ agreement evidences such an intent. Historically, we have been